Charting a unique course

Monday, November 19, 2012

By Eric Johnson

Bogatch-Genossar

In the container shipping world, there really isn’t a glass ceiling for women to break through. It’s more like trying to break into a Swiss bank vault. Which made the August appointment of Lea Bogatch-Genossar as president of Zim American Integrated Shipping Services, the Israeli container line’s North American subsidiary, all the more unusual in an industry renowned for operating as a male-dominated club.
Bogatch-Genossar, a 20-year veteran with Zim who has served in the line’s North American headquarters in Norfolk, Va. since 2009, doesn’t believe she’s cracked any code in terms of gender equality.
“First of all, the most important thing is I don’t even think about it,” Bogatch-Genossar said in an interview with American Shipper in late October. “I only concentrate on doing the job. I am a passionate person. And I am passionate about Zim. If I have a customer and we can’t load their cargo, I go crazy.
“At the end of the day, I can look in the mirror and say I did the best I could. And people can see that this is someone who does a good job and someone they can trust. I didn’t get things because I am a woman. And I didn’t not get things because I’m a woman. I really don’t think my being a woman held me back at all.”
That said the number of high ranking female executives in the liner world doesn’t make for a long list. Mediterranean Shipping Co.’s Trade Manager for Asia Caroline Becquart is another notable exception. In North America, there are also Lamont Peterson, vice president of transpacific westbound trade for Hyundai Merchant Marine, and MJ Dornford, vice president of sales and marketing for Hainan PO Shipping Agency (USA).
Bogatch-Genossar said it was “very surprising” there are not more women in executive positions in the industry by now.
“There are not a lot,” she said. “When I come to the (Transpacific Stabilization Agreement) meetings, I’m the only woman there, unless Caroline has come. There are advantages and disadvantages. As a woman, you can achieve just as much as a man.
“The majority of the problem is it’s very hard to combine being a mother and a career woman. Kids are the most important thing. It is so hard to go away on travel and to work late at night, but the hardest part is when they become used to it. I always think how lucky I am to play in these two worlds.”
There is one distinct benefit to being a woman in the liner industry: “The biggest advantage (in being a woman) is I can say harsh things and it doesn’t sound so bad. There is a different concept of management between women and men. Communication and focus on people are the most important thing. For instance, it’s pointless to me to have a booking clerk, taking bookings all day, if he doesn’t understand the outcome of what he does. He won’t be as motivated.”
But distilling Bogatch-Genossar’s rise to become Zim’s top executive in North America down to one facet is a disservice. Her career has taken her from the line’s global headquarters in Israel to Italy and then to Norfolk. She’s worked in numerous divisions within Zim, gaining on-the-ground experience that liner executives often miss on their fast-track to management.
And now she’s focused on honing Zim’s business in its most important market. The Norfolk office is responsible for around 40 percent of Zim’s global revenue, controlling as it does the line’s activities in the Western Hemisphere.
“One of the things you see when moving from one place to another is that, eventually, the world is small,” she said. “You cannot look at America separately from China, or Europe, or South America. That’s a zero sum game. If there’s a crisis in Europe, goods are cheaper from Europe, so buyers go there and that will impact North America. But I believe North America is the buying power of the world, the engine of the world. That doesn’t mean everything is happening here. But it is the trigger.”

Destined For Zim. Bogatch-Genossar’s story is really inextricably linked to the former national shipping line of her home country (Zim was privatized in 2004). Her father worked for Zim’s logistics division, and it had a transformative effect on her childhood and future ambitions.
As a fifth grader, she moved to Italy when her father was transferred to the company’s office in Genoa. While the adjustment to a new country was initially difficult, Bogatch-Genossar eventually reveled in the new culture and language. And she became indelibly enamored with the glamor of her father’s international vocation.
“To hear to the names of the ports in the Far East, like Singapore and Hong Kong, it all sounded very fascinating,” she said. “I wanted to be part of a global organization. To be in a non-international business was not interesting enough. I used to come to my father’s office, and I’d see the ships and containers. It was all so complex, I couldn’t think anything else could be so interesting.”
So in a sense, her decision to join Zim was ordained. After completing her degree in economics and industrial engineering at Israel’s famed institute Technion (often dubbed the country’s MIT), and finishing her military duty, Bogatch-Genossar joined Zim in 1992, eight years after her father had left the company.
She started in the line’s planning and development department, which handled the studies and profit analysis functions of the company, overseeing issues like joint ventures, service rotations, and vessel deployment, among many others.
“After being behind a computer, I wanted to feel how it was to be in a real market,” she said. “The natural move (from planning and development) was to be a line manager. But I wanted to go to sales because I feel that’s the best way to know your business.”
So she spent three years in sales in Israel before becoming Zim’s line manager for Northern Europe.
“I felt I completed the circle,” she said. “To be a line manager, it’s nice to understand how to run your line in terms of profitability. But to make the right decisions, you really have to know your customers. If you don’t come from the field, it’s just numbers. So you might ask yourself why somebody would go to one terminal and not another 30 miles away. When you work with your customers, you understand why operations in one place influences their business. It gives me a more complete picture.”
Bogatch-Genossar said the path she had chosen was not a well-worn one.
“Until today, I still don’t know anyone else who went from (planning and development) to sales,” she said. “It was supposed to have delayed my career by three years, but those were the most important three years.
“It’s very rewarding to be in sales. To convince people to reach in their pocket and pay you money for your service. Of course, it’s difficult, but it’s really great. You have deep personal relationships with the customers. They still have my cell phone number and I am there for them. Customers are your bread and butter. Without them there’s no business.”
In addition to managing the Northern Europe services, Bogatch-Genossar was appointed to manage Zim’s South American activities. Eventually she became the marketing manager for the short-seas services, where she oversaw three line managers.
Next up was a move to the cusp of Zim’s executive level, when she became an assistant to Zim’s chief executive officer at the time, Doron Goder, headlined by her role in reducing $100 million in costs in 2006.

Childhood Revisited. In 2007, she was on the move again, relocating back to Genoa, the place where it had all started.
“The house we found the second time was on the same street as my school used to be,” she said. “Twenty years later, I was reliving my childhood.”
Only this time, she had her own two children, and a deep understanding of what it meant to move away from the comfort zone of home.
In two years in Genoa, where she was in charge of Zim’s ZCS service, Bogatch-Genossar focused on expanding the line’s customer base.
“My task was to increase the portfolio of core customers on that service,” she said. “Before, 80 percent of our volume was from five customers. We changed it to 80 percent from 30 customers.”
It was in Italy where Bogatch-Genossar got an inkling of the difficulties facing women in the male-dominated shipping world.
“It’s not easy being a woman in power in Italy,” she said. “It’s hard for the said ‘old boys club’ members in Italy to have a business conversation with a woman, without reference to subjects such as soccer, or using certain famous Italian verbiage.”
Eventually, though, Bogatch-Genossar broke down the barriers and made progress. And just as she and her family were settled in Genoa, the phone rang again. It was Zim CEO Goder asking her to move to Norfolk to help with Zim’s most important foreign market.
Her first reaction to the request: “Non capisco,” she said, Italian for “I don’t understand,” but actually meaning, “Thanks, but no thanks.”
But they proved to be persistent, persuading her of the importance of her presence in such a vital market.

A New Challenge. Her initial experience in the United States proved to be drastically different than those in the Mediterranean. She said U.S. customers are less emotional and more focused on the business at hand.
That was a difficult transition for Bogatch-Genossar, who thrived on building personal relationships with her customers, but found it difficult to break down the privacy barriers that U.S. customers tend to build. It was also hard to converse about football and baseball, two sports she had little knowledge of.
“So I talked about what I know what to talk about – family, relationships, and diet,” she said. “When I met them the first time, I thought it would be hard to talk to them again. But I’ve learned the culture. You have to come armed with an agenda and focus on how can I help their business. How working with Zim and not other companies will be better for their business.”
Bogatch-Genossar said she appreciates the business acumen of her North American customers, and the organization here that allows contracts to be honored.
“I believe the American market is very organized,” she said. “An agreement is an agreement. Everybody honors their agreement. That gives stability which is very much needed in this market. There is less stability in other trades.”
She also said North American customers have a more sophisticated understanding of the need for carriers to be properly compensated for their services, and the symbiotic relationship between the two parties.
“Customers in North America understand that a relationship with a shipping line is a partnership,” she said. “They understand they need the shipping line as much as the shipping line needs them. There is a growing number of customers who say stability is more important than a $100 savings in my rate.”
When asked what the most misunderstood aspect of liner shipping is, Bogatch-Genossar didn’t hesitate.
“Shippers don’t understand that once a vessel has sailed it’s not coming back,” she said. “They don’t understand the difference of a capital-intensive company versus a human resources-intensive company. So the capital is very crucial. When we purchase a vessel, we are making a 20-year commitment. A slot that sails isn’t coming back, so that’s why we have to fill it.
“Some of the customers understand it. They see that shipping lines are a mirror of the economy. When the shipping industry is good, the economy is good.”
Bogatch-Genossar said that was reflected well in early 2010, when shipping lines had pulled back capacity in the wake of a dreadful 2009 and were caught short of capacity when demand rebounded.
“The demand problem in 2010 had a butterfly effect,” she said. “Stability and rate levels have to be maintained. We’re absorbing costs from customers and rail operators because we’re the only ones who are flexible.
“Some will say, ‘why did you buy these ships?’ But someone has to provide this capacity, and it needs to be more efficient. Everybody understands that everybody has to be well. It can’t be that some parts of the supply chain are making billions and others lose money. That can’t work.”

A North America Focus. Zim’s North American network is extensive. According to the BlueWater Reporting service of American Shipper affiliate ComPair Data, as of late October, 40.5 percent of Zim’s weekly allocated global capacity served trades to and from North America. Twenty-five percent of that global capacity was allocated to the transpacific alone, including a slightly higher proportion westbound on the U.S. export side.
When asked how the United States’ National Export Initiative fits into Zim’s North American network, Bogatch-Genossar said Zim has traditionally viewed exports as a standalone product.
“Zim has always looked at exports out of North America as a major part of our business,” she said. “It is a business that has to sustain itself on its own, not just as a byproduct of the inbound. The more we can send out with full containers out of North America, the more it will contribute to the bottom line. Not all shipping lines understand that.”
She also commented on the recent increase in refrigerated cargo rates in the industry, with Maersk leading a drive in September to push reefers compensation levels higher by the start of 2013. The move has been mirrored by other lines and supported by the Transpacific Stabilization Agreement, which announced its members would seek increases of $1,500 per FEU.
“The last three years (2009-2011), there has been growth of reefer products out of North America,” she said. “A lot of shipping lines bought equipment, renewed their fleets, got more gensets. It came to a point that the margin of profit on reefer is the same as on a dry container, and then you understand you have a problem. We’re totally supportive of the GRI.”
She said changes such as this have to be instigated by one of the larger lines in the industry. Zim, according to maritime analyst Alphaliner, has the seventeenth largest containership fleet in the world as of early November.
“All shipping lines will look at additional income and costs savings more than they did before,” she said. “But it takes a leading line to take the courageous step to do that. If a smaller line does this and the bigger ones don’t do this, it won’t work. The TSA is able to be so strong because the leading shipping lines are part of it.”